In the Matter of Williams Press, Inc., Appellant,
v. James M. Flavin, as State Reporter of the State of New York, et al.,
Respondents

Court of Appeals of New York

November 19, 1974, Argued
December 20, 1974, Decided

Matter of Williams Press v. Flavin, 44 A D 2d 634, affirmed.

Appeal by permission of the Court of Appeals, from an order of the Appellate
Division of the Supreme Court in the Third Judicial Department, entered April
2, 1974, which unanimously affirmed a judgment of the Supreme Court at Special
Term (George L. Cobb, J.; opn.
74 Misc 2d 1082), entered in Albany County, declaring the rights of the parties with respect to
certain issues presented by a proceeding brought pursuant to
CPLR article 78.

HEADNOTES

Law reports—official law reports—on awarding of contract for publication of official law
reports to another contractor, present publisher-contractor is not entitled to
commissions or discounts on renewals of subscriptions placed with it during its
tenure as publisher; list of subscribers is property of State and claim of
publisher to property interest in list is without legal foundation and is, as
matter of policy, untenable—provision in contract for commissions and
discounts to "law book dealers" does not include publisher which is not dealer
within meaning of contract—question as to furnishing of Session Law advance
sheets by publisher to subscribers of official reports is hypothetical.

1. Upon the awarding of the contract for the publication of the official New
York, Appellate Division and Miscellaneous Law Reports to another
contractor, the then publisher-contractor is not entitled to commissions or
discounts on
renewals of
subscriptions placed directly with it during its
tenure as
publisher. The list of
subscribers is the property of the State. Considering the State's historical and
substantial interest in official
law reporting, the
public nature of the tasks performed by the
publisher for the State
Reporter, the special status of the reports and the direct benefits innuring to the
publisher as a kind of exclusive franchise, the claim of the
publisher to a
property interest in the list of
subscribers is without legal foundation and is, as a matter of policy,
untenable. An exclusive
property right in the
publisher in such a list under circumstances so interwoven with the
public interest has not been recognized.

2. The previous contracts providing for commissions and
discounts to
"law book
dealers" on
subscription
renewals does not confirm the
publisher's
property right in the list. The
publisher is not
a
"law book
dealer" within the meaning of the contract which delineates between the
publisher and such
dealers.

3. The question with respect to the furnishing of
Session Law
advance sheets by the
publisher, which also published the
Session Laws, to
subscribers of the official reports, whereas other
contractors were exempted from that requirement is
hypothetical and the request for
declaratory relief as to provision therefor in future contracts was properly declined.

COUNSEL

John T. DeGraff for appellant. I. Williams Press had vested property rights in the official
series before the 1956-1960 contract was executed. (Little v. Banks, 85 N. Y. 258;
Banks v. Hun, 20 App. Div. 501;
Matter of New York Post v. Liebowitz, 2 N Y 2d 677;
Town & Country House & Home Serv. v. Newberry, 3 N Y 2d
554;
W. Walley, Inc. v. Saks & Co. 266 App. Div. 193;
Witkop & Holmes Co. v. Boyce, 61 Misc. 126;
Matter of Arnay, 18 Misc 2d 266.) II. The property rights of Williams Press were acknowledged and confirmed in
all three of the contracts drafted by the reporter for the period from 1956
through 1970. III. The contentions
now advanced by the reporter
and by Lawyers Co-op. are inconsistent with their prior conduct. IV. The
courts below have failed to come to grips with the basic issues in this case.
V. The Session Law provision adopted by the reporter in the 1971-1975 contract
is discriminatory.

Michael T. Tomaino and
William D. Eggers for Lawyers Co-operative Publishing Company, respondent. I. The two lower
courts have properly held that Williams Press has no property right in the
subscription list to the official reports and no right to discounts and
commissions on any subscriptions obtained while it was the contractor. II. The
1955, 1960 and 1965 contracts do not grant Williams Press the right to
discounts and commissions from succeeding contractors on subscriptions obtained
while Williams Press was the contractor. III. Any controversy concerning
paragraph 11 of the annulled contract is hypothetical and declaratory relief
should
not be granted. The paragraph is not discriminatory.

David W. Peck and
James H. Carter for James M. Flavin, respondent. I. The list of subscribers to the official
reports compiled by Williams Press from the names of persons who placed
subscriptions through it during Williams'
tenure as contractor is the property of the State of New York and must be
delivered to the reporter upon request for use by any designated successor
contractor. II. The contractor has no contractual right to receive commissions
or discounts on renewal subscriptions originally placed through it in the event
of a change in contractor. III. The reporter is under no duty or obligation
to include in any new contract for publication of the official reports any
clause relative to furnishing printed copies of the Session Laws to reports
subscribers, and the courts below correctly declined to review a provision in
the annulled
contract concerning this matter. (Prashker v. United States Guar. Co., 1 N Y 2d 584;
Manhattan Stor. & Warehouse Co. v. Movers & Warehousemen's Assn., 289 N. Y. 82.)

The controversy arises from a contract to publish the official law reports—
New York, Appellate Division, Miscellaneous—of the State of New York.

In November, 1970, the State
Reporter, with the approval of the then
Chief Judge, awarded a five-year contract to the
Lawyers Co-operative Publishing Company. The Williams Press, Inc.,
publisher of the reports since 1898 and the unsuccessful
bidder in 1970, refused to yield the list of
subscribers and certain materials necessary to publication and distribution. The State
Reporter, with the approval of the then Chief Judge,
annulled the contract because of the possibility of disruption in publication. The
State
Reporter's action was ultimately sustained in the courts on the ground that his decision
was not subject to judicial review. (Matter of Lawyers Co-op. Pub. Co. v. Flavin, 69 Misc 2d 493, affd. 39 A D 2d 616,
mot. for lv. to app. den. 30 N Y 2d 488.)

This proceeding ensued in January, 1971, an interim agreement having been
reached by the State
Reporter and Williams for publication of the official reports pending resolution of the
issues raised. Nominally a proceeding in article 78 challenging the validity
of the Lawyers Co-operative contract, it has been treated by the parties and
the courts as one for
declaratory relief.

The nub of the controversy concerns the
subscription list in which Williams claims a
property interest.
Specifically, the claim is that should there be a change in the
publisher, Williams is entitled to
commissions or
discounts on
renewals of
subscriptions placed directly with it during its
tenure as contractor-publisher. This right, it is alleged, is confirmed by the
language of Williams' post-1956 publishing contracts with the State
Reporter. Additionally, the petition seeks a declaration of rights with respect to a
provision in the 1971-1975 contract
regarding the publication of the
Session Laws
advance sheets. Williams, who for some years had published the
Session Laws
advance sheets in addition to the official reports, was required by its contract to furnish
such
advance sheets to
subscribers of the official reports at no additional cost. Lawyers Co-operative, as a
bidder on the
annulled 1971-1975 contract, was exempted from a similar requirement. This, it is
said, discriminated illegally against Williams and a declaratory judgment is
asked with respect to the inclusion of such provisions in the new contract to
be prepared for rebidding.

Special Term adjudged that the list of
subscribers to the official reports was the property of the State and that Williams
had no contractual right to
renewal commissions or
discounts on
subscriptions originally placed with it. But it was further adjudged that Williams, as
transferee of
subscriptions placed with
"law book
dealers", was entitled to receive commissions on annual
renewals of those
subscriptions. The court declined to adjudicate the issue respecting the
Session Laws
advance sheets, terming it
hypothetical only. The Appellate Division, with an opinion, unanimously affirmed and we
granted leave to appeal to consider the important policy questions raised.

Official
law reporting in New York has long been a matter of State concern. The history, which often
tracks changes in the court system, begins in 1804 when the Legislature
empowered the then Supreme Court of Judicature to appoint a
reporter of decisions.[1] As it developed, the official
reporter published not only the decisions of the Supreme Court of Judicature, a court
of general as well as appellate jurisdiction, but also the decisions of the
Court for the Trial of Impeachments and the Correction of Errors, then the
State's highest court. In 1814, the official
reporter commenced publishing the decisions of the Chancery Court as well, until, in 1825, appointment of a separate
Reporter for Chancery decisions was authorized.

In 1846, major constitutional changes in the court system were made and the
Court for the Trial of Impeachments and the Correction of Errors was abolished.
The Court of Appeals, precursor of the present court, was created as the
State's highest appellate tribunal.
Pursuant to constitutional authorization (N. Y. Const., 1846, art. VI,
§ 22), publication of the present series of New York reports was begun under the
supervision of a
reporter of decisions, denominated the State
Reporter and
appointed by the executive branch. (L. 1847, ch. 280.) By statute, distribution of the
reports to State Agencies was augmented (L. 1847, ch.
280,
§§ 73, 74) and an interstate report exchange plan
was initiated (L. 1847, ch. 277). Interestingly, the Legislature saw fit to
regulate the selling price of the
volumes as well. By statute (L. 1848, ch. 224), the price was fixed at a
rate not to exceed $ 3 for a 500-page
volume.[2] With regard to the Supreme Court, its composition and jurisdiction were
substantially changed and no provision was made for official
reporting of its decisions.

The 1869 Judiciary Amendment to the Constitution effected further changes in
the judicial system with
corresponding consequences for official
law reporting. The Court of Appeals was reorganized and express constitutional provision
for a
reporter of decisions, to be
appointed by the court, was made. (N. Y. Const., 1869 Amdt., art. VI,
§ 2.) Four General Terms of the Supreme Court, forerunners of the present Appellate Division in
the State's four judicial departments, were created and provision was made for
official
reporting of the decisions of the court by a Supreme Court
Reporter. (N. Y. Const., 1869 Amdt., art. VI,
§ 23.) Pursuant to statute (L. 1869, ch. 99), this second official
reporter was
appointed by the executive and publication of the Supreme Court's decisions at General
Term was begun. Once again, the Legislature interceded to regulate the selling
price per
volume and the number of
volumes to be published each year (L. 1869,
ch. 99).

In 1892, pursuant to statute (L. 1892, ch. 598), the Office of Miscellaneous
Reporter was created. An executive appointee, the Miscellaneous
Reporter was charged with
reporting the decisions of all courts of record, except the Court of Appeals and the
General Terms of the Supreme Court. With provision for official
reporting of all courts of first instance, an obvious void in the coverage of the
official series was filled and the State's official law reports assumed the
basic tripartite structure which has been maintained basically unchanged.

With adoption of the Constitution of 1894, the present Appellate Division of the Supreme Court was created. Provision
was made for an official
reporter who retained the title of Supreme Court
Reporter and was to be
appointed by the Appellate Division. (N. Y. Const., 1894, art. VI,
§ 2.) The Supreme Court Reports of decisions at General
Term were discontinued and the present series of Appellate Division Reports began. The Court of
Appeals retained the power of appointment and removal over its
reporter (art. VI,
§ 7) and provision was made for legislative regulation of the
reporting of court decisions (art. VI,
§ 21).

In 1924, the office of Miscellaneous
Reporter was abolished and its functions were transferred to the Supreme Court
Reporter. By amendments to the Judiciary Article of the Constitution, approved in
1925, the framework was laid for the present structure of official
law reporting. Provision was made for the creation by the Legislature of a
State Law Reporting Bureau to be headed by a State
Reporter,
appointed by the Court of Appeals and responsible for
reporting the decisions and opinions of all the State's courts. Not until 1938,
however, was this constitutional authority exercised. In that year, by statute (L. 1938, ch. 494), the offices and
duties of the State
Reporter and the Supreme Court
Reporter were merged and the present
Law Reporting Bureau was established. The tripartite division of the official reports—
New York, Appellate Division and Miscellaneous -- was continued under the aegis
of the State
Reporter and the
Law Reporting Bureau. With only minor changes, the 1938 statutory scheme remains in effect
today.

This chronology of official
law reporting in New York has been reviewed in some detail for it is of more than mere
historical interest. In our judgment, it reflects the State's deep and abiding
concern that the decisions of its courts be authoritatively and expeditiously
reported, published and distributed.

Today, this high responsibility reposes in the State Law
Reporting Bureau under the direction and control of the State Reporter.
(Judiciary Law, § 431.)
Printing and publication of the official reports, no less than the preparation of
headnotes, fact summaries, points of counsel, indexes and tables, are his
responsibility. (§§ 433, 433-a.) To accomplish these tasks, he is empowered to
enter into contracts, subject to the approval of the Chief Judge, for the
printing and publication of the reports on terms and with conditions deemed by him to
be most advantageous to the
public and the State (§ 434, subd. 4). Similarly, and again subject to the Chief Judge's approval, he may
annul any
printing and publication contract when in his sole judgment the
public interest so requires (§ 434, subd. 12). It is against this background and the
public nature of the tasks performed by the
publisher for the State
Reporter that the claimed
property interest in the list of
subscribers must be assayed.

There is more. Since the beginning, the official law reports
have had a special status. Today, and for some time, it has been statutorily
required that New York decisions be cited to the courts of this State from the
official reports. (CPLR 5529, subd. [e].) The courts themselves as a rule
cite only to the official reports of New York decisions. Also, the official
series contains the State Reporter's headnotes and syllabuses, not to be found
in unofficial reporters, and which in point of fact are copyrighted for the
benefit of the People of the State. (Judiciary Law, § 438.) Although,
unlike some jurisdictions, the headnotes and
syllabuses lack the imprimatur of the court, they too have a special character as the
product of the State
Reporter and his deputies whose professional qualifications are statutorily prescribed (§ 435).

It follows that because of the special and favored status of the official
reports, special benefits inure to the
publisher and printer. While there are private
unofficial
reporters, the
publisher of the official reports enjoys a kind of exclusive franchise conferred by the
State. Also, the
publisher is the direct beneficiary of the State-created incentives to subscribe to the
official series.

In sum, considering the State's substantial interest in
official law reporting, the public nature of the tasks performed by the
publisher for the State Reporter, the special status of the official reports and
the direct benefits inuring to the publisher as a kind of exclusive franchisee,
the claim to a property interest in the list of subscribers is without legal
foundation and is, as a matter of policy, simply untenable. Nor, for much the
same reasons, do the trade secret cases aid the Customer List—As Trade Secret—Factors Ann., 28 ALR 3d 7.) Indeed, no case has been called to our attention recognizing an exclusive
property right in a
subscription list under circumstances so interwoven with the
public interest.

Petitioner's other points for reversal have been carefully considered and
little need be added to what has already been written at Special Term and the
Appellate Division. In sum, we cannot agree with the pivotal contention that
Williams' previous contracts providing for commissions and
discounts to
"law book
dealers" on
subscription
renewals
confirm its
property right in the
subscription list. We see no escape from the conclusion that for purposes of commissions and
discounts, Williams is not a
"law book
dealer" within the meaning of the contract provisions which, it seems to us, clearly
delineate between the contractor-publisher and
"law book
dealers". Regarding the issue of the
Session Laws
advance sheets, we agree that the question is
hypothetical only and that the request for
declaratory relief with respect to provision therefor in future contracts was properly declined.

Accordingly, the order of the Appellate Division should be affirmed.

Order
affirmed, with costs.

FOOTNOTES

Footnote 1: There is an important article detailing the history of official
law reporting in New York—Moore, One Hundred Fifty Years of Official
Law Reporting and the Courts in New York
(6 Syracuse L. Rev. 273).

Footnote 2: Over the years, the Legislature continued to oversee the price of the
official reports, sometimes with deleterious consequences. (See Moore, One
Hundred Fifty Years of Official
Law Reporting and the Courts in New York
(6 Syracuse L. Rev. 273, 300-302.)